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Peter Passell is editor of The Milken Institute Review, the Institute's economic quarterly. A senior fellow, Passell joined the Institute after eight years as economics columnist for the news department of The New York Times. He previously served on the Times' editorial board and was an assistant professor at Columbia...

So the promise of practically every politician running for president since Carter is finally being fulfilled: According to the International Energy Agency, the United States will soon be energy independent. More specifically, the U.S. will lift more oil out of the ground than it consumes.

Time, then, to thumb our noses at all those Persian Gulf sheiks who've been giving us a hard time since 1973, or to trade in your Prius for an Escalade? Not quite. Nothing of substance will really change. Indeed, the very idea of energy "independence" never meant much in the first place. Oil, no matter where it's produced, is sold in an international market. The price paid at the pump in Peoria is as much determined by the amount of oil supplied by Saudi Arabia or Venezuela as by the supply from Alaska or Montana.

Yes, but if the Saudis or Venezuelans decided to stop selling oil (an unlikely prospect, but that's another story), weaEUR(TM)d still have enough for our ourselves, right? Hardly. The United States could no more easily refuse to export oil to an oil-starved world than it could refuse to defend Germany from an attack by the Russians (another unlikely prospect, but you get what I mean).

The real import of the news about U.S. oil production is that global supplies of oil are likely to exceed demand for some time to come. That's good news in the sense that oil prices are likely to remain manageable -- but not so good news if you care about global warming. Don't trade in that Prius just yet. Please.